This November, Maine citizens will vote on a tax reform proposal sponsored by the Citizens to Reduce Local Property Taxes Statewide. The proposal – Question 1A – struck a chord with the voters of Maine as more than 100,000 people statewide – the largest number in the history of Maine – signed petitions on a single day last November to place the proposal on the ballot this year.
The proposal is a result of frustration with the Legislature’s refusal and inability to address tax reform. For decades the Legislature has discussed, debated and studied the problems with Maine’s antiquated tax policy. Despite cries to change the system during those years, the Legislature failed to take action.
Angry property owners told us their local property taxes are too high. Burdensome local property taxes impact the elderly, young property owners, renters and local businesses. It was obvious that fundamental tax reform was needed to save the future of our state – and it was equally obvious that the leadership for this effort had to come from the people most affected – the property taxpayers.
This effort is no knee-jerk reaction to a “new” problem. Initiating citizen petitions is not business as usual for the Maine Municipal Association. The state’s refusal to keep its promise in terms of education funding – a nearly 20-year-old broken promise – has cost local property taxpayers statewide almost $2 billion. This money has been paid by local property taxpayers and should have been funded at the state level. In good times – the state has created new programs and not funded this promise – and in bad times, the state has cut education funding further. At no time has the state reduced the rules or rolled back the mandates that drive these expenses – they only pass along the costs to the backs of local property taxpayers.
The federal government passes along unfunded mandates to the state, and the state passes along unfunded mandates to local government. The buck stops at the local level. Part of my job is being face to face with the general public every day – and foreclosing on property owners for unpaid property taxes. Sitting across the desk from residents who are in this position is an education in itself – and one that I do not think anyone wants to face.
The bottom line is that property taxes are too high and one of the driving forces that causes them to be too high is the failed promise on education funding at the state level. 1A would generate a 15 percent savings average statewide in property taxes. That is real money for real people – and most important of all, the determination for making sure that those savings are actually translated into real savings for taxpayers will rest at the local level – the level most controlled by property taxpayers themselves.
Question 1A means hard work and tough choices for the Legislature because 1A is about more than “show me the money.” 1A is the only question that requires the Legislature to deal with the broken, antiquated and volatile tax structure that is responsible for the “boom and bust” cycles that the state has experienced for years. 1A is the only option that requires the Legislature to develop a tax burden management program to get us from the top of the heap – in terms of overall tax burden – to the middle of the pack. And finally, 1A is the only proposal that provides incentives to encourage schools and municipalities to find more cost-effective ways to do business.
Contrary to the negative ads being run by the proponents of 1B, 1A is a revenue-neutral proposal that will not require the Legislature to inflate the overall tax burden in Maine by one penny. What it does force them to do is acknowledge that property tax is a tax – and one that is as important in their consideration of overall burden as income and sales taxes. 1A is the only proposal that will force the state Legislature – or perhaps provide it with the political will – to clearly define its spending priorities – and to fund them appropriately. This is the very same thing that each and every one of us does every day in our own personal lives and in our business lives.
1A says “enough is enough.” Step up to the plate and keep your promise to the children and the property taxpayers of this state – and don’t wait six more years to do it. Question 1B requires you to wait three legislatures and another gubernatorial election for real tax relief – and the first year of 1B actually increases the local property tax burden by $45 million by reducing funding to 246 schools – and totally eliminating funding to almost 100 schools in the second year. 1B tries to gain voter approval by restoring the Homestead exemption – the same program that the Legislature took away last year – and it offers a circuit-breaker program that extends into the middle class – which is like applying a Band-Aid to a severed aorta. It will not begin to stop the bleeding. What it really does is treat symptoms instead of dealing with what is really wrong with the tax structure in Maine.
1C – if possible – is even worse than 1B. 1C is worse because 1C does nothing. Status quo. Business as usual – but with a known $60 million property tax increase in the upcoming fiscal year due to the existing budget. Rhetoric aside – 1C does not force the Legislature to do anything. It actually would likely be seen as validation of 20 years of inaction on this subject. We cannot afford more of the same and that is all that 1C offers.
Maine is at a crossroads. Property taxes are in a state of crisis. People cannot wait six more years for things to change. Maine property taxpayers cannot take any more broken promises. Local property taxpayers are a constituency that deserve consideration because they are the ones who are footing the bill.
Please join me in voting for 1A in the upcoming referendum on Nov. 4.
Susan Lessard is president of the Maine Municipal Association and is the town manager in Hampden.
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